Aren't We Really Seeing Basic Free Market Problems? What's in a Name? - Up and Down Wall Street - A. Abelson - Barrons.com

What's in a Name? - Up and Down Wall Street - A. Abelson - Barrons.com

Here it is early December 2009. Darling and Sarkozy have decided any extra tax, on fat banker cats especially, is a tax to love. Is the clear political and social anger at bank profits telling us something far more significant that what we are actually talking (or not talking) about?

Lest we forget the concept underlying the idea of a free market - when profits (say, at banks) get too great, then the great leveling effect of the market should encourage the entry of competitors (after all, lots of people without jobs, measly interest rates of almost nil, etc.)

But, one asks, where are these competitors? And, if not, why not?

None's to guess the answer, but meanwhile, where there's money, the government (and populace) appears to want to install putative extra taxes along with excoriation.

And, meanwhile, the developing world, that somehow never could gain the knack of how to develop (i.e. somehow the Chinese figured it out but not the Africans, etc.), so now those who still have a mite of credit left (i.e. the Europeans who are already borrowing to make ends meet) are finding themselves going into further hock for developing countries who seem to have one more excuse (global warming) as their hindrance to make it on their own.

So, where or where will all of this lead?????? Well, right now it has already led to substantial unemployment (10% plus) and underemployment (approaching 20%)in the US.

We should be asking ourselves why individuals and businesses don't want to put money at risk and invest in job creation and the hope for profits.

But, we're not really asking this question because the answer may well lie in government's attempt to control outcomes, redistribute too much wealth and pull back on the rewards and incentives to take risks and make a better life.